Toyota, GM to shut plants, cut output

Agencies|

Nov 20, 2008, 12.00 AM IST

0Comments

TOKYO/SOUTHFIELD: Reeling from a relentless sales slide, Toyota Motor said on Wednesday it would stop all of its North American factories for two days next month, while Nissan renewed its pessimism over the industry���s near-term prospects. Tight credit and worries over the spread of recession around the world have battered car sales in all major markets, forcing automakers to cut production to prevent inventories from ballooning further.

Toyota had already cancelled all US production of slow-selling light trucks for three months this summer. A spokeswoman said production would be reduced further in 2009 at three US assembly plants. The worst economic crisis since the 1930s has hit healthy car makers hard and ailing rivals even harder, threatening the survival of Detroit���s Big Three. CEOs of GM, Ford and Chrysler warned Congress on Tuesday that their industry was teetering on the brink of disaster as they pleaded for a $25 billion aid package to ride out the storm.

Carlos Ghosn, chief executive of Nissan and Renault, speaking separately in Washington, chimed in with his own bleak view of the sector���s short-term prospects with a reminder that Nissan was expecting virtually no profit in the October-March second half. ���We have to recognise 2009 will be one of the most challenging years for our industry and the whole economy in the last 50 years,��� Ghosn told the Wall Street Journal.

Meanwhile, General Motors, seeking federal aid as it burns through cash, will close five plants for as long as two weeks and cut back on overtime after sales plunged 45% last month. Two-week shutdowns are planned at factories in Louisiana, Delaware and Missouri, while plants in Tennessee, and Ontario will close for one week, Chris Lee, a GM spokesman, said on Wednesday.